Laws of the People's Republic of China

CHAPTER ONE GENERAL PROVISIONS CHAPTER TWO TRANSFER OF LAND USE RIGHT CHAPTER THREE SUBSEQUENT TRANSFER AND MORTGAGE OF LAND USE RIGHT CHAPTER FOUR REGAINING OF LAND USE RIGHT CHAPTER FIVE SUPPLEMENTARY ARTICLES

   Article 1 These Provisions are formulated in accordance with the relevant provisions in the Law of the People's Republic of China on Land Administration, the Implementing Regulations of Jiangsu Province of the Law on Land Administration, the Regulations of Jiangsu Province on the Administration of Economic and Technological Development Zone and the actual conditions in the city for the purpose of intensifying land administration in the Lianyungang Economic and Technological Development Zone and promoting the opening to the outside world and economic construction.

   Article 2 The land within the Lianyungang Economic and Technological Development Zone (hereinafter referred to as the Development Zone) may be transferred against payment. The Transferred land may be subsequently transferred, mortgaged and leased. Only the land use right is subject to transfer and subsequent transfer. The ownership of the land, the underground resources and the hidden objects thereof belong to the State and shall not be subject to transfer and subsequent transfer.

   Article 3 All kinds of enterprises, other economic organizations or individuals both at home and abroad may be the transferee and subsequent transferee of the land use right in the Development Zone.

The legitimate rights and interests shall be protected by law.

   Article 4 The Administrative Committee of the Lianyungang Economic and Technological Development Zone(hereinafter referred to as the Administrative Committee of the Development Zone) shall, on behalf of the Municipal People's Government of Lianyungang, take charge of the compensatory transfer and subsequent transfer of the land use right within the planning scope of the Development Zone, the formalities for obtaining and issuing the State-owned Land Use License, and administering and supervising the development, utilization and management of the land.

   Article 5 The compensatory transfer of land use right shall be examined and approved by the People's Government at or above the level of municipality within the limit of authority of approving the right to use the land under local administration.

   Article 6 The transferee shall abide by the laws and regulations of the People's Republic of China and the relevant provisions of Jiangsu Province and Lianyungang City in establishing various kinds of enterprises or undertaking various construction projects on the land vested with land use right.

CHAPTER TWO TRANSFER OF LAND USE RIGHT

   Article 7 The compensatory transfer of land use right refers to the economic activity of the Municipal People's Government of Lianyungang transferring, according to law, the right to use the land in the Development Zone against payment to the transferee for development, utilization and management of the land.

   Article 8 The land use right may be transferred against payment in the following forms:

(1) Agreement. The Administrative Committee shall negotiate with the land use demadant and, after reaching a consensus, sign a contract of land use right transfer.

(2) Bidding. The Administrative Committee shall send invitation for bid to creditable enterprises, other economic organizations and individuals both at home and abroad and choose the better as the one winning the bid according to the bidding procedure.

(3) Auction. The Administrative Committee shall fix the land area to be transferred, organize the land use demandants to bid publicly against each other and determine the land user according to the principle of "the highest bidder would be the winner".

   Article 9 The land use right shall be transferred within the ceiling period of 50 years. In case of particular necessity, the ceiling period may be appropriately extended upon the approval of the Municipal People's Government of Lianyungang.

   Article 10 The written contract of transfer shall be signed for transferring the land use right. The Contract of transfer shall be notarized by the notarization agency.

After signing the contract of transfer, the transferee shall, within the time-limit as prescribed in the contract, pay the transfer fee to the Administrative Committee of the Development Zone, and go through the registration formalities, obtain the land use license and pay the land use fee.

   Article 11 The transferee shall, after acquiring the land use right, strictly fulfil the contractual obligations. Any transferee failing to fulfil the contractual obligations according to law may be fined by the Administrative Committee or even the land use right may be taken back without compensation.

   Article 12 In setting up buildings and other installations on the land vested with land use right, the transferee shall strictly abide by the regulations of the Development Zone on land use and the relevant provisions on construction planning and real estate administration.

CHAPTER THREE SUBSEQUENT TRANSFER AND MORTGAGE OF LAND USE RIGHT

   Article 13 The subsequent transfer of land use right refers to the economic activity of the transferee, after acquiring the land use right, subsequently transferring the land use right to a new transferee within the period of land use right transfer. The subsequent transfer of land use right covers such forms as sale, exchange, grant and inheritance, etc..

The mortgage of land use right refers to the economic activity of the transferee, after acquiring the land use right, mortgaging the land use right for loan or other debt within the period of land use right transfer.

   Article 14 After the subsequent transfer or mortgage of the land use right, the new transferee and mortgagee shall fulfil the obligations as prescribed in the original contract of land use right transfer.

While subsequently transferring and mortgaging the land use right, the ground construction and the other attached objects shall be subsequently transferred and mortgaged concurrently. While the transferee subsequently transferring and mortgaging the ground construction and the other attached objects, the land use right thereof shall be subsequently transferred and mortgaged concurrently.

If the subsequent transferee is an individual, the land use right may be inherited by rightful heir.

   Article 15 Land by which transfer fee is not totally paid according to the contract of transfer or land on which the investment has not reached to the floor amount as prescribed in the contract shall not be subject to subsequent transfer and mortgage.

   Article 16 A written contract shall be signed by the two parties concerned for subsequent transfer and mortgage of land use right. The contract of subsequent transfer and mortgage shall be approved by the Administrative Committee of the Development Zone.

   Article 17 Upon the approval of the contract of land use right subsequent transfer, the subsequent transferor shall pay the land value added fee and the two parties concerned shall go through the related formalities for subsequent transfer registration, obtain the land use license and pay the land administration fee. Upon the approval of the contract of land use right mortgage, the two parties concerned shall go through the registration formalities and pay the land administration fee. Meanwhile, the new transferee and mortgagee shall, holding the subsequent transfer contract or the mortgage contract, go through formalities for change of ownership and tax payment with the real estate and taxation agencies of the Development Zone.

The land value added fee shall also be charged for voluntary subsequent transfer of land use right.

   Article 18 If the planned usage as prescribed in the original transfer contract needs to be modified in subsequent transfer of the land use right, the original transferee shall, in advance, file an application with the Administrative Committee of the Zone and shall, upon the approval thereof, re-sign modify or supplement the transfer contract and going through the formalities for subsequent transfer registration.

   Article 19 Once the mortgage contract is canceled due to the liquidation of debt or the other causes in the case of mortgage of land use right, the parties concerned shall cancel the mortgage registration at the Administrative Committee of the Development Zone. If the mortgagor fails to liquidate the debt before the contract expires, the mortgagee shall have the right to dispose of land use right according to the mortgage contract and these Provisions.

   Article 20 Any transfer and subsequent transfer of land use right in violation of these Provisions shall be invalid. The Administrative Committee shall confiscate the illegal income, order to dismantle the illegal ground construction or other installations within a set time; inflict administrative punishment on the responsible person(s) and the person(s) illegally subsequently transferring the land use right and impose a fine of RMB 100-500 yuan concurrently.

CHAPTER FOUR REGAINING OF LAND USE RIGHT

   Article 21 Upon the expiration of the transfer contract of land use right, the Administrative Committee shall regain the land use right and cancel the land use license. The basic installations and the ground construction and the attached objects shall be dealt with according to the relevant terms of contract, if any; or shall be dealt with according to the relevant provisions of the State in absence of such contract terms.

   Article 22 If the land user needs to continue to use the land when the contract expires, he may, six months prior to the expiration of the contract, file an application with the Administrative Committee and, after the approval thereof, re-sign a contract of land use right transfer, go through the related registration formalities and obtain the land use license in accordance with the stipulations in Chapter TWO of these Provisions.

   Article 23 The land user shall timely dismantle and clear the ground buildings, facilities and installations or pay the dismantlement and clearance fee as prescribed in the transfer contract or the subsequent transfer contract.

   Article 24 If the land use right needs to be taken back under special circumstances before the transfer contract expires, the Administrative Committee shall inform the land user six months in advance and the two parties concerned shall negotiate about reasonable reimbursement according to the actual conditions.

CHAPTER FIVE SUPPLEMENTARY ARTICLES

   Article 25 Before using land as investment form or cooperative condition to establish a joint venture or contractual enterprise with foreign investor(s), the Chinese co-operator(s) shall obtain the land use right by means of transfer or subsequent transfer of the right.

   Article 26 If the land use right was acquired prior to the implementation of these Provisions, the original land use contract shall continue to be effective. If need be, the rights and obligations may be re-determined in accordance with these Provisions.

   Article 27 The matters not regulated by these Provisions shall be dealt with according to the relevant provisions of the State and the Province.

   Article 28 The Administrative Committee of the Development Zone may formulate detailed implementing regulations in accordance with these Provisions.

   Article 29 These Provisions shall enter into force on the date of promulgation.